has apparently been “hidden” as “off-topic”. It’s possible
for it to be fairly judged as “off-topic” but the intent
was to address the convenience of using Cryptos
as a “funds transfer mechanism” which is one of
the primary impediments to U.S. persons, when
working with offshore brokers.

Restrictions imposed by CFTC and related government
agencies on “funds tranfer” to/from Offshore brokers,
is the main reason I would post a Crypto related
topic in this forum. It is a way to more "smoothly’
transfer funds, outside of the traditional funds
transfer mechanisms.

I don’t mind if moderators want to hide it, but the purpose
is to provide information on “smoother” methods of
transferring funds between U.S. persons’ dollar
denominated activities, and their Offshore brokerage
accounts, which is the main focus of this forum thread.

There are certainly other crypto related posts in this thread,
and I continue to assume these are to increase awareness
that Cryptos are an efficient funds transfer mechanism
for U.S. persons having difficulty or inconvenience transferring
funds to/from their legitimate offshore brokerage accounts…

The increasing availability of crypto transfer mechanisms is an
effective way to mitigate regulatory over-reach which we
as U.S. persons experience in funds transfer… In my view…

I don’t mind if moderators want to hide it, but the purpose
is to provide information on “smoother” methods of
transferring funds between U.S. persons’ dollar
denominated activities, and their Offshore brokerage
accounts, which is the main focus of this forum thread.

HyperScalper,

Like you, I was surprised that your post was flagged. It was completely “on topic” in this thread. Money-transfers can be problematic in dealing with offshore brokers, and the use of cryptocurrencies to facilitate those transfers is a subject we have discussed at length in this thread, and will continue to discuss.

I will refrain from a full rant on the subject of “flagging”, and instead simply re-post (as a quote) what was “temporarily hidden”.

HyperScalper:

SHIFT DEBIT CARD LINKED TO COINBASE BTC WALLET

OK, this is not advertising, but just an observation that if you are using
Crypto to transfer funds, and you hold BTC at Coinbase you just pulled from one
of your trading accounts, then there is a Shift Debit Card which
can be linked via Partnership with Coinbase, which will Debit from
your Coinbase BTC wallet at any point of purchase at the "spot"
price for USD against BTC… If you can figure out how to do it,
then it ping pongs betweeen Coinbase and Shift to set up the
debit card. Just FYI, I set one up myself, but “Caveat Emptor” LOL

After setup fees for the card $10 I think, and issuance of
the actual PLASTIC card, they charge no fees for most transactions.
I think you may even be able to use it without the physical PLASTIC via Shift’s
API, not sure, but look that up for yourself though…https://www.shiftpayments.com/ shows a sample API request…
fairly “futuristic” I’d say …

First time posting on here, but longtime FX trader. Just finished reading all the comments about CCM. Are there any updates from y’all?

Here’s the status from my end. I was originally with Tallinex and was pushed into CCM because of the whole US client thing. Been with them ever since without much issue. Now I have both personal and PAMM accounts with them (investor accounts I manage). I realize most the issues investors talked about happened last year. I had investors deposit money (via wire transfer) without issue, and I even withdrew $5k in January '18 without issue. But now I’ve got problems. I requested to withdraw an additional $5k in February and have yet to receive it (almost 2 months at this point!). I contacted them earlier this month and this was the reply (I have another response, but can only post 1 pic since I’m a “new user”):

Also, my contact for managed accounts has stopped communicating. For me this only reached an alarming stage today and I’m considering halting further investing (I have investors set to deposit funds with CCM) until my funds go through and some sense of surety is restored. After reading through here and re-reading CCM’s responses I don’t think I’ll trust them any more for now. I believe I’ll move to another broker like Finpro Trading (since they offer PAMM accounts).

This is all a huge inconvenience for me a disheartening as I don’t want to scare of my new investors.

Would be interested to know others’ recent experiences or update about CCM.

First time posting on here, but longtime FX trader. Just finished reading all the comments about CCM. Are there any updates from y’all? …

After reading through here and re-reading CCM’s responses I don’t think I’ll trust them any more for now. I believe I’ll move to another broker like Finpro Trading (since they offer PAMM accounts)…

Would be interested to know others’ recent experiences or update about CCM.

Hello, FinancialWorld, welcome to this thread.

Two-and-a-half years lurking on this forum, eh? – Well, I’m glad you’ve decided to come out of the shadows

Thanks for posting about your situation with CCM. If I understand it correctly, the banking problem you have described is a new problem, separate and distinct from the deposit scandal reported by several of our members five or six months ago. And I find this to be alarming.

The two problems taken together seem to indicate that CCM cannot be trusted to handle customer money.

Like you, I’ve been wondering whether any of our members who were caught up in the deposit scandal have received restitution from CCM. We haven’t heard from those members for a long time. So, if you guys are tuned in, this is my request for information on your current situation,
vis-a-vis CCM.

FW (I’m going to call you that), please keep us updated on your dealings with CCM.

I think that the outcome of this latest CCM fubar will determine whether we keep them on our List.

Yes, this is a new problem. I’m trying to remain optimistic, but maybe that’s because I haven’t lost all my money yet. I am in contact again with my PAMM account manager and am pressuring the need for answers, quick resolution, and something to restore my faith in CCM.

As it stands right now, the issue appears to have always been the banking intermediary (even for the deposit scandal). Pretty sure they’ve changed intermediaries a couple times over the last few years, but I don’t have record of this. But back to topic, my first priority is to understand what’s going on, see if my withdrawal can be processed (which would partially restore my faith in CCM), and if that isn’t possible right now to get the funds re-issued to my account (because they shouldn’t have left the company). I’ll let you all know what happens, and will keep an eye on the thread to see others’ updates.

Here’s the most recent response I’ve receive from CCM about my withdrawal – which has been in “Pending Wire Transfer” mode since Feb 22.

[CCM response]

Hello xxxxxx,

The information I sent you in the previous e-mail was received from our accounting department. They will contact you as soon as they have any updates, but it may take more than 24 hours.

There are currently some issues with our bank, because since they have changed their internal policies they are requesting additional information/documentation from us in order to process the withdrawals. It means that the withdrawals are taking now longer then usual, as these additional verifications take time. However the withdrawals are being processed, just not as fast as before. That’s why your withdrawal is still in queue. However, we expect this issue to be resolved soon. And as soon as our billing department has some news/updates from the bank they will let you know.

I remain optimistic, but am concerned on why this has taken so long. Will hopefully have a concrete answer from CCM accounting within the next 24hrs.

[details=Summary]Lets say a bucket shop broker who has about 100 active clients where in every client is trading approx 10 lots per day (20 lots buy + sell). To me that sounds like a small shope who is on the verge of not being able to survive.

Now lets say this bucket shop is trying to compete with larger brokers and gives a very low commission just like our top brokers. Lets assume commission is $2 per lot ($4 round trip)

SO, with just these 100 small traders, trading over 20 trading days in a month the broker will make

Average Number of Lots Per day * 2 * Number of clients * Number of days in a month

SO your maths will be

10 * 2 * 2 * 100 * 20 ===> $ 80,000 per month

So effectively a very small bucket shop will make approx $80,000 USD per month with just 100 active clients paying $2 per lot per side trading just 10 lots per day

Assuming the bucket shop becomes technically good and starts to charge a premium commission of $5 per lot instead of $2. Everything else remaining the same, the theoretical profit of this bucket shop is now $200,000 per month.

Well, to me that sounds like a lot of money to keep running a bucket shop.

Now, assuming that this broker only wants to make money from his clients losses.

Average balance required to trade 10 lots per day will be (very very conservatively) $5000.

So if all the clients loose money the broker will make $500,000. But if he runs a A book he will make $200,000 per month.[/details]

Very simple math indeed. And let’s not complicate things by introducing the more obvious real life costs [details=real life brokerage operating costs]
add a few more real life elements that affect [bucketshop] brokerage’s cost of doing business

Assuming the typical bucketshop will not invest $100k for a new mt4/mt5 license +
$15-20k monthly in server expenses, they are likely going to white label mt4 for $5k + 1.7k MQ monthly fees. The white labeler may also have additional service fees, but let’s just add $2.3k and make it even $4k/month. The white labeler has given us permission to use our own feeds also, so we can do a/b hybrid book (or 100% b book if you want).

You will need a risk management engine of some kind. If you aren’t sending flow to your white labeler, then you must have software to do real-time analytics of how much risk you have on either book at any given time. $1k+ and/or based on volume/included with bridge.

Compliance/dealing staff salary + benefits. $6-8+k/month for yourself + 2 full time people minimum. White labeling will save you some money here, but again, you might be subject to monthly minimum flow.

Cost to whitelabel/source legitimate price feeds. Technically each broker makes their own price, but if it deviates too far from the “real” price, then price arbitrage opportunities will abound or people will not use your services because the cost is too high.

Cost to bridge liquidity from PoP. $0 for bucketshop. But $2.5-$4.00 R/T is not uncommon depending on volume. Remember that there may be costs for additional price feeds even if you do not send any actual flow.

Cost of acquisition / advertising / etc between $300-$1500 per client or more

Adverse selection. Active traders are likely to be informed (which is why they are active and will continue to be active). If you are only internalizing risk, you are pretty screwed as you have no way to offload risk to a larger wholesaler. Or you’d have to have massive spreads.
[/details]

Assuming you have 100 active clients trading 10 lots per day with $5k starting balance, this would imply that those active clients are profitable on average [details=clients Not profitable example] (if clients were not profitable, they could only continue to pay commissions for$4 r/t x 10 lots/day x 63 trading days = -$2520 x 100 clients = -$252,000, assuming they average breakeven across all trades.
Losses would be much faster if they are losing 2+ pips on every trade.

…So effectively a very small bucket shop will make approx $80,000 USD per month with just 100 active clients paying $2 per lot per side trading just 10 lots per day …

$400,000 - $80,000 = $320,000 net profit due to 100 traders…or $3,200 per trader. It’s a good chance that profitable traders are going to request regular withdrawals. Especially with a new broker. If 1/2 of the client base choose to withdraw profits…

$3,200 x 33 (1/3 of 100 clients) = $105,600 [-$25,600 broker profit]

$3,200 x 50 (1/2 of 100 clients) = $160,000 [-$80,000 broker profit]

Where are the the trader profits paid from? If the broker takes on the risk, then the broker has to pay from its "winnings"

You could argue that the broker could just simply increase their commission. But then like any other product, you must compete with other brokers. So unless you have some unique execution or pricing (which the average bucketshop likely would not), why should we trade with your brokerage?

In reality, you will have a handful of clients that even trade >=10 lots daily higher. Most will likely trade <5 lots/ month.

whywescalp:

I see it as a no-brainer, why smaller bucket shops will not follow a pure A book as that will be a longer term winning proposition. Unless we are talking about shady and crooked brokers who kill their clients will slippages and order rejections techniques.

My suggestion, instead of following consiparacy theories. We should rather focus on quality brokers who have a track record of execution, speed and withdrawals.

Very few offshore retail brokers will have this let alone accept US clients. As I predicted several years ago, nearly all of the brokers that initially told the US CFTC to F-off eventually “bent the knee.” The ones that still accept US clients are either doing so very quietly or are fraudulent brokerages who fake legit operations in a major jurisdiction. At least Trader’s Way and Tallinex was honest about where they operate from. Many of the brokers on the current list (TurnKeyFx, FinPro) go out of their way to fake a popular jurisdiction or not reveal their regulatory status at all.

@codybear we know – review the first post of this discussion. The fact that Turnkey isn’t regulated is why we’re reviewing them on here. Other off-shore brokers just won’t accept US clients now (with just a hand-full of exceptions).

Update on CCM: I contacted my PAMM account manager and asked for an update and for the accounting manager to contact me. I’ve been assured that WITHDRAWALS are still being processed but that it’s very slow and mine is in queue. They haven’t given a time-frame so I don’t know if I’ll be waiting 1wk or 3mo.

Hello xxxx,

You probably already heard from Kris that we’ve been experiencing some issues with our bank. Due to changes in their internal policies (which we understand relate to tighter banking controls in general), they’re requesting additional information and documents for almost all withdrawals we process. We’ve been collaborating with the bank in order to provide the requested details and documents, however it takes time for us to collect the required information and for them to check that all is in order. We’re trying to process withdrawals in the order they were requested, but due to these additional checks and limits the bank has imposed, many withdrawals are still queued, including yours.

We’re sorry for the inconveniences and delays this is causing. Please understand that the withdrawals are being processed, just not as fast as we and our clients would like. We believe that this issue will be resolved soon. Unfortunately, we cannot provide you with an exact time frame, also because today and on Monday the bank is closed due to Easter holidays.

While I’m happy that things are supposedly still moving I don’t like that they can’t give me a time-frame. After no updates for 5 days I’ve sent the below response.

Hello Emma,

Thank you for your response.

Can you please provide me with a time line on when my wires (Request ID xxxx and xxxx) will be processed and sent? Request ID xxxx has been in queue since February and this is taking unacceptably long. I also have PAMM accounts at CCM and because of the withdrawal delays my investors are considering withdrawing their funds. This will be a loss to both CCM and to me, and I would like to avoid this! Wire transfers do not take this long, so I cannot understand why this hasn’t been sorted out by now. I do not understand what amount of documentation your bank would be requiring that would slow withdrawals down this much.

Please be more transparent on why this is taking so long, what your team is doing to expedite the process, and what changes are being made to assure this doesn’t happen again in the future.

Also, please provide me with a timeline for completion and expedite the process where possible.

Best,
FinancialWorld

I’m pushing them for answers, transparency and a timeline of when they’re going to take care of this. The delays are already costing me, and have actually run me short on cash.

inovatrade had rave reviews for 2 yrs prior to mike alcocer shutting it down overnight and walking away with the funds of over 1000 traders that totaled almost 200 million…they even sponsored a golf tournament a couple months prior to the shut down thereby luring in even more money…
unregulated should be Thee biggest red flag to not include them…

yes I understand its up to each individual to do their own full due diligence themselves and decide but lets include the disasters from the past.

@codybear - you are correct, and yes that’s something I worry about. I think that’s part of the risk we take on when we go off-shore. Obviously we don’t want to be stupid, which is why I’ve found this thread so helpful. I think it’s important to look at the structure of the broker as well. CCM splits investor’s funds between 6+ major banks and only minimal at CCM to post margin. Here’s the breakdown with one of my accounts:

Turnkey on the other hand states that:

Safety of Funds
Turnkey Forex ensures the protection of client funds. We are able to distinguish client money from the firms’ own money by holding the client money in a segregated client bank account, held with an approved banking institution.

In the unlikely event that Turnkey Forex enters into liquidation, all funds in segregated client bank account held with our bank will not be affected by such a default and will remain for the benefit of the relevant client.

Now I haven’t found out who this “bank” is, but segregation of funds is very important when dealing with off-shore and unregulated brokers.

when pressed for the information of the bank name where client funds are held, turnkey will not tell you…the only answer I received was we dont disclose that information…
Even inovatrade released the banks name…I’d be curious as to Where the refunds from turnkey come from and the account name…

Regarding Trade.com and its parent company, CySEC just fined them with EUR 30,000. According to the regulator the sanction was imposed because the company has not acted honestly, fairly and professionally in accordance with the best interests of its clients in Romania.